Londis shareholders accept Musgrave offer

The fate of Londis was sealed last night when shareholders in the convenience stores group voted in favour of a £60m takeover bid from Ireland's Musgrave.

The fate of Londis was sealed last night when shareholders in the convenience stores group voted in favour of a £60m takeover bid from Ireland's Musgrave.

The deal ends a colourful seven-month takeover saga that Musgrave kicked off last December with an agreed £40m bid. Londis's shareholders rebelled against that offer after it emerged that four of the company's directors would have scooped half the bid proceeds, leaving the shop keepers with just £10,000 each. Under yesterday's deal, which is expected to complete next month, shareholders will each receive a windfall payout of £31,000.

Support for the deal stymied an 11th-hour attempt by a group of former T&S directors to table a £63m takeover proposal for Londis under which they would have acquired a 40 per cent minority interest in the group for £25.2m.

About 50 Londis shareholders turned up to a meeting in a Birmingham hotel yesterday afternoon to vote on the deal. In total, 97 per cent of votes cast backed the Musgrave deal, which needed the approval of 75 per cent of the votes cast. Just two people in the meeting voted against the deal.

Peter McNamara, the acting chief executive of Londis, said: "The shareholders have chosen Musgrave as the partner to provide the extra buying power and financial strength needed to succeed in an increasingly competitive market."

He had previously admitted that the offer from Musgrave had not been the highest on the table from the 21 bidders that threw their hat in the ring to acquire Londis. However the board decided to recommend it because it felt it would be the best deal for shopkeepers in terms of their future trading arrangements.

Musgrave said it would post shareholders their cheques on 9 August. It will pay out the windfalls in two tranches, with the second due in 12 months provided shopkeepers maintain a trading account with the Irish group, which also owns Budgens and the Supervalu and Centra stores in Northern Ireland.

Eoin McGettigan, Musgrave's executive chairman, said: "Our aim is to deliver improvements in areas such as chilled range, to sustain investment in point-of-sale systems and to maintain and improve pricing structures. We will also develop strong internal communications structures to ensure that there is real and meaningful dialogue with Londis retailers."

Under yesterday's deal, Londis's top four former executive directors - Mr White, Andrew Wallace, Denise Buller and Terry Bedford - will receive none of the £60m. Instead, they will share a £2m one-off payment, which will be paid out of Londis's existing cash resources.